We all want to make money, whether it’s for bills, gifts, or just because we like the feeling of knowing we can take care of ourselves and our families. But should you really be trying to make money from your interest in making money? Maybe not! Find out why here.
The Value of Learning
Learning new things—even if you don’t have plans to use them professionally—can have a serious impact on your career. According to a study published by Social Science Research Network, individuals with more cross-industry experience and knowledge (of) varied industries are also more likely to find high-paying jobs. If you can show potential employers that you’re an all-around great fit for their company, they’ll be much more likely to offer you higher pay. Here’s one idea: If there’s a skill or industry that has always interested you but haven’t gotten around to pursuing, try picking up a class on it at your local community college or startup incubator.
Are You Saving Enough to Retire Yet?
It can be hard to put money away for retirement, but it’s necessary to ensure you’ll have enough to live on when you no longer earn an income. If you plan on retiring soon or at a young age, chances are your 401(k) won’t be enough for living expenses. Try investing in an IRA or Roth IRA (if your income allows) because contributions are tax-deductible and investment returns are usually higher than those of a traditional 401(k). Also, get used to saying no to small purchases that could add up over time.
The Dangers of Debt
Getting into debt isn’t always a decision made by choice. If you have accumulated a large amount of credit card debt, it could be time to look at your options to eliminate that burden. While taking out a personal loan is one option for consolidating or paying off your credit card balance, interest rates can be very high. So let’s talk about an alternative method to consider: peer-to-peer lending. Peer-to-peer loans are gaining popularity due to their low interest rates and borrowers get access to money they need more quickly than other methods like banks and credit unions offer.
Start Saving Early
If you’re interested in making money and you don’t already have an emergency fund, start saving. If you can’t afford to save up 3-6 months’ worth of expenses, then consider saving as much as possible. The bottom line is that if a financial emergency arises, you want to be prepared with cash on hand so that it doesn’t lead to more debt or credit card problems down the road. Look at all your expenses and see where there are opportunities for savings. For example, pay off your credit cards and avoid going into more debt.
Work After Retirement
Retirement is one of those topics that is surrounded by a ton of myths. Most people have no idea what retirement will be like and many think that it’s something to worry about later. However, if you think about it, you could actually be able to enjoy retirement a lot sooner than you think. If you want to retire early, there are steps that can help make it happen for you. Read on for five great tips for retiring early and enjoying your time outside of work!
What Type of Investments are Appropriate for Me?
Before you even think about making money, take some time to decide what type of investment will be appropriate for your needs. Are you looking for short-term returns (i.e., investments you can cash out quickly) or long-term profits (investments that will continue to appreciate)? What is your risk tolerance: do you want a return on your money, or are you more interested in preserving capital? These are all important considerations when deciding which investments are right for you.
Why I Stopped Investing in Individual Stocks and Bonds
When I started out, I quickly realized that making money was more important than saving it. So, for years, I actively invested in individual stocks and bonds with varying degrees of success. It wasn’t until recently that I decided to stop paying attention to individual investments because they weren’t offering me any tangible returns. Today, at 23 years old, my stock portfolio has outperformed all but a few of my friends who are also earning minimum wage—and they don’t have a chance of ever catching up now that they’ve started at such a disadvantage. If you really want to be wealthy over time, you need to focus on your long-term goals instead of beating the market through short-term speculation.
Do Not Try This if You Want to Retire Early
The easiest way to make money from interest is by earning interest on your savings. For example, if you invest $100 at 5% APR and don’t touch it for a year, you’ll end up with $105. Not bad! But if you withdraw even just a little bit of that principal—$5, say—you’ll see your balance erode quickly. The second reason earning interest is not ideal for early retirement is because there are diminishing returns when earning interest. Let’s say you start with $100 and earn 1% each year.
My Biggest Investment Worry Today
As a value investor, my biggest fear with respect to my portfolio is inflation. The longer I hold an investment, and especially if that investment is income-producing, I worry that it will eat up too much of my income when I need it. Why not convert those assets into cash flow and invest them elsewhere? Doing so allows me to lock in some gains for myself instead of taking a risk with inflation. And cash flow is critical because it takes money to make money. Inflation eats away at investments without you even knowing it until you suddenly find that your real wealth has declined over time.
Is There a Right Time To Start Investing?
The honest answer to that question is, No one can tell you what’s right for you. Investing involves risk. There’s no way around it. There are people who have lost all their money through investments and others who have made millions. The key to making smart decisions about investing is learning as much as possible about how investments work and deciding for yourself if investing sounds like a good idea for you at any given time. With that said, it doesn’t make sense to start investing until you’re ready to do so.